The Council of the European Union agreed by a very large majority (23 votes in favour, 2 votes against, 2 abstentions) on a political agreement (‘general approach’) in principle on the proposal for a Directive on adequate minimum wages on Monday 6 December.
“I must say I had some doubts that we would be able to come to this result and now I am very happy this was achieved”, said Nicolas Schmit, Commissioner for Jobs and Social Rights, at a press conference, and he sincerely thanked the Slovenian and Portuguese Presidencies of the EU Council. He added: “(This proposal) could have been a divisive proposal, and finally - and here I must say thank you to the Slovenian Presidency - it has become a proposal which has unified Europe”.
The Slovenian Presidency of the EU Council, through its Minister of Labour, Janez Cigler Kralj, acknowledged that the dossier was “extremely difficult”, citing the contestation among some delegations of the legal basis chosen by the European Commission (see EUROPE 12675/13). The Minister explained that the Slovenian Presidency had opted for “open” communication with national delegations to facilitate convergence.
French Labour Minister Elisabeth Borne welcomed today’s vote on her Twitter account. She assured that the French Presidency of the EU Council, which is preparing to take over in the first half of 2022, would continue the work (i.e. inter-institutional negotiations with the European Parliament) always “with respect for each other’s social models”.
Since the Gothenburg Summit enshrining the European pillar of social rights at the end of 2017, France has been one of the Member States particularly committed to upward wage convergence (see EUROPE 11907/1), alongside Luxembourg, Belgium, Spain, and Italy.
The issue of respect for the autonomy of social partners has been a major sticking point throughout the EU negotiations, especially for the Scandinavian Member States, traumatised by the Viking and Laval judgements of the EU Court of Justice (see EUROPE 9611/27).
As such, Denmark voted against the compromise along with Hungary, which also opposed it based on the subsidiarity principal. Sweden, long opposed to the text, confirmed its support for the compromise (see EUROPE 12839/22) as acceptable. Germany abstained. The country could not vote in favour because the federal government is not yet in place. Austria also abstained. This country is said to have taken a very hard line throughout the negotiations, a diplomatic source told us.
A non-binding text
The text adopted today is not very binding, as the Commissioner halfheartedly acknowledged, recalling that European action is limited by the European treaties.
The legislative text changes its title to emphasise that it is a framework within which national minimum wages evolve. The coverage of collective bargaining is listed as indicative rather than as an objective. However, Member States without 70% coverage will have to submit an action plan.
The criteria for assessing the adequacy of minimum wages are made more flexible and may refer to international or national criteria. Setting a wage, even indirectly, through binding criteria would be going against the treaties, the Commissioner defended, when asked about the lack of ambition of the compromise by a journalist at a press conference.
The possibilities for variations and deductions from statutory minimum wages have been left to the discretion of Member States, as long as the principles of proportionality and non-discrimination are respected.
The conditions for data collection have also been relaxed, with a report to be made on the minimum wage situation every two years, instead of annually as foreseen in the text proposed by the European Commission (see EUROPE 12591/8).
For the Commissioner, what is important is the EU’s “message” that wages should be increased. He recalled that this has not always been the case in the past, especially during the previous crisis.
Difficult inter-institutional negotiations
The EU Council’s political agreement was welcomed in Parliament, notably by co-rapporteur Agnes Jongerius (S&D, Netherlands), on her Twitter account. However, the inter-institutional negotiations, which are due to start under the French Presidency of the EU Council, are likely to be difficult, as the positions of Parliament differ so much from those of the EU Council.
In particular, parliamentarians have raised the level of collective bargaining coverage to 80% or clearly specified the poverty line as a criterion for calculating the adequacy of statutory minimum wages (see EUROPE 12840/18).
Compromise on the Directive on adequate minimum wages: https://bit.ly/3xSVadG (Original version in French by Pascal Hansens)